Sorry, this time of year I take a little time off to look for Bambi, so I have not posted much lately.
I thought you might appreciate this little cartoon Barron’s published a little while back. It pretty much sums up the current negotiation, er, standoff…stalemate or something. One side keeps making offers while the other sits back and refuses to talk until he gets everything he wants, or so it seems. It makes the Republicans look either pathetic or trying vainly to make a deal, depending on your orientation, I guess. It makes Pres. Obama look either tough or obstinate, again depending on your point of view.
Still, I don’t know what mandate Pres. Obama think he has. Some 60% of Americans polled say they want rates raised on the rich but when you ask them if those earning over 250K should pay a 40% rate, 64% of Americans say no, according to the WSJ.
If you read Obama’s book, though, you know that he made a big deal about wealth redistribution, so I believe him when he says no offer without higher rates for those earning over 250K will not be considered. It really is something he cares about. I am upset, though that entitlement reform has been taken off the table. Without it, this is all fighting over little pieces.
For the market’s part, it has remained pretty sure a deal will be done. But, as it gets closer to Christmas and it still looks bleak, prices could start dropping.